The global pharmaceutical sector has around $700 billion at its...

The global pharmaceutical sector has around $700 billion at its disposal to acquire other companies and invest in research and development, according to Goldman Sachs Research. That war chest will be important as patents expire for some of the industry’s blockbuster drugs.“The pharmaceutical industry will need growth, and is sitting on a tremendous amount of cash,” says Asad Haider, head of the healthcare business unit in Goldman Sachs Research. “The baseline expectation is that there is going to be continued M&A.” In addition, he says there’s been tremendous progress in innovation and there are signs that surgical procedure volumes are on the rise. MedTech is expected to be the industry’s best performing subsector in the second half of the year, according to a midyear investor survey conducted in conjunction with Goldman Sachs’ 44th annual Global Healthcare Conference.We spoke with Haider about the outlook for promising drugs and stock returns for the rest of the year, as well as his takeaways from our conference, which featured management teams from more than 200 healthcare companies.